Managed File Transfer

Co-authored by Karthick Ravishankar (karthick.ravishankar@in.ibm.com)


“An electronic invoice, or ‘e-invoice,’ is an invoice that has been issued, transmitted and received in a structured electronic format that allows for its automatic and electronic processing.”

In this blog, we are exploring how to integrate e-invoicing in Italy using the “Sistema di Interscambio” (Sdl) clearance platform.

Italian Electronic Invoice:

E-Invoices are intended to avoid Value Added Tax (VAT) fraud and malpractice. Since January 1, 2019, the Italian government has mandated that companies doing business in that country must issue all invoices electronically, to conform with FatturaPA, and send them through the official document interchange platform, Sistema di Interscambio (Sdl).

Invoices transmitted in the FatturaPA XML format must bear a qualified digital signature, and wide-ranging, country-specific requirements need to be considered with regard to archiving.


What is FatturaPA?

FatturaPA is the official standard for the Italian Clearance model, and is document complaint with XML Schema Definition (XSD) based on their intended use for B2C, B2B, B2G and “simplified schema,” which applies to smaller invoices that are below a threshold amount.

The FatturaPA XML may contain either a single document or a batch of documents, but it is important to highlight the functionalities for signing.

Enabling compliance:

To avoid penalties and fines and ensure e-Invoicing compliance, businesses should have the following processes in place:

• Creating transactions – Supplier invoices (TD01), deposit/down payment on invoice (TD02), deposit/down payment for fee (TD03), credit notes (TD04) and debit notes (TD05) must be created in the XML format defined by the Italian tax authority (FatturaPA XML).
• Signings – Each transaction must contain a certified digital signature.
• Sending – Transactions must be submitted when issued via the government exchange system (SdI – Sistema di Interscambio).
• Receiving – Buyers have the responsibility of ensuring that transactions are received in the right format, or risk fines and penalties.
• Accepting/rejecting – Business-to-government (B2G) buyers must explicitly approve or reject transactions. If they have not done so within 15 days, the invoice will be automatically approved.
• Archiving – Companies must maintain transactions archives for 10 years.

Guaranteeing the integrity of invoice information:

Each FatturaPA file transmitted to the SdI should be signed by the party issuing the document by means of a qualified signature certificate. This signature guarantees the integrity of the information contained within the document, as well as the authenticity of the issuer.

The SdI accepts the following signature formats for FatturaPA:

• CAdES-BES (CMS Advanced Electronic Signatures) with a structure compliant with the public specifications ETSI TS 101 733 V1.7.4.
• XAdES-BES (XML Advanced Electronic Signatures), with a structure compliant with the public specifications ETSI TS 101 903 version 1.4.1. The only method accepted for this type of signature is the “enveloped” method. Additionally, the XAdES signature must have the element Reference URI=“” or with URI=“#iddoc” where iddoc is the identity code of the document to be signed. The URI attribute cannot be omitted from the Reference elements.  

Send files to SdI:

The transmission of the invoices to the SdI (and ultimately its delivery to the buyer) can be made using one of the following channels:

• Posta Elettronica Certificata (PEC): An email-based service that certifies the date and time of any communications sent or received, as well as the integrity of contents therein (otherwise known as a “certified email service”). Many small and medium-sized enterprises use PEC for delivery and receiving of FatturaPA.
• SdICoop: A web-service based system accessible through HTTPS certificates for entities that have not been certified for the SPC (Sistema Pubblico di Connettività) network.
• SPCoop: A system accessible via domain ports for entities that have been certified for the SPC network.
• SdIFTP: A system of data transmission between remote terminals based on the FTP protocol, that ensures the safety and certainty of the channel used between the involved participants.
• FatturaPA web interface: It is possible to manually send a FatturaPA via their web interface if the sender holds credentials for either Entratel or Fisconline or have a National Service.

The message flow sequence:

Transmitter:

The transmitter is defined as the entity that connects to the SdI to deliver the FatturaPA and receive call-backs with notifications from the SdI. The transmitter may be the supplier or an entity acting on behalf of the supplier, such as TrustWeaver (an e-invoicing partner) or a hub.

Recipient:

The recipient is defined as the entity that will receive the FatturaPA from the SdI and may be the buyer or an intermediary acting on its behalf, such as TrustWeaver or a hub.

B2B and B2C:

Cross-border e-invoicing:

The Italian e-invoicing clearing mandates do not apply to cross-border invoicing in which one of the transacting parties (i.e., either the supplier or buyer) has a VAT number issued by a third country. SdI clearance requirements strictly apply to Italian domestic invoicing only. Although certain information on cross-border transactions needs to be reported to the Italian tax authority on a monthly basis, e-invoices may be exchanged without intervention of the SdI.

What if invoice fails?

Failure to invoice will result in the supplier refusing to pay the non-compliant invoices. In the event of discrepancies or errors in the contents of an e-invoice (e.g., the invoice amount), suppliers and buyers should contact each other directly and agree upon the issuance of a credit note or similar. Invoices cleared by the SdI are awarded VAT fiscal value even if the contents are subject to dispute; therefore, the issuance of credit or debit notes are needed in case the original e-invoice must be amended.

Italy e-Invoicing with IBM Sterling Supply Chain Business Network:

Smaller companies have the option of entering or downloading the data for a small number of invoices by means of a web portal or PEC (a government communications system similar to the German De-Mail).

Larger companies, on the other hand, will not be able to get around connecting their ERP systems directly with Sdl to automatically process their FatturaPA invoices and any responses that may arise. There are many Business Integration Service providers (Trustweaver, Retarus, Seeburger,etc) who can address FatturaPA conversion, the signature process as well as long-term archiving.

IBM is a leader in market and offers an e-invoicing solution on its IBM Sterling Supply Chain Business Network (SCBN). IBM’s B2B integration solution enables collaboration with customers, suppliers and other business partners. e-Invoice is mainly for VAT and GST regulatory compliance and IBM e-Invoicing solution focuses on VAT compliance.

IBM has extensive e-invoicing experience in Italy. We have a number of clients and their trading partners who have successfully sent e-invoices to the Italian government’s platform SdICoop. We have helped customers convert files from UBL to FatturaPA.  We have enabled both inbound and outbound connection flow to receive and send the FatturaPA messages from the Italian government SdICoop via our e-invoicing partners (e.g., Trustweaver). And we have provided guidance to business partners and clients about how to map with FatturaPA.

IBM Sterling e-Invoicing supports the following e-invoicing flows in Italy:

• Signing
• Signing and Archiving
• Clearance
• Archiving

Generic Inbound flow:

Sequence for inbounding a FatturaPA in the generic inbound model is illustrated below:

Generic Outbound flow:

The end-to-end sequence for issuing a FatturaPA in the outbound model is illustrated below:

During mapping of FatturaPA, we adhere to the following:

• • Supplier/Buyer Address Details
    
  • Invoice Number
  • Currency code
  • Amount
  • Item details etc

Here is an Example of FatturaPA mapping which has TAX and VAT related fields with tax amount, tax percentage, taxable amount etc.

The picture below shows TAX amount fields in UBL format data:

The picture below shows the corresponding mapping of FatturaPA standards fields for the UBL fields mentioned: